The UN Global Compact recently published a thought provoking report on a survey of over 750 chief executives from member companies on how business can help create the social, political and economic conditions to cut carbon and become more sustainable.
It found that over 90% of chief executives believe that sustainability will be critical to the future success of their businesses. A similar proportion believes that sustainability can be fully integrated into strategy and operations within 10-15 years.
Consultants Accenture, which conducted the survey, said this is an important shift in attitudes. Only a few years ago, most executives would have said that business sustainability was impossible.
However, the survey reveals a significant gap between what chief executives believe all companies should be doing and their own firms’ performance.
For instance, most said companies should embed sustainability issues into their supply chains. But only a little over a half reported that they were actually doing this. And while three quarters said sustainability objectives should be included in employee assessments, less than half had started to act.
The chief executives identified several barriers preventing companies from becoming more sustainable. These include:
- scepticism about whether customers can be relied on to demand lower-impact goods and services over the long-term term
- an almost total lack of interest in sustainability among investors
- the lack of a robust regulatory framework to create a level playing field for all businesses.
The bottom line is that, no matter how much any individual chief executive believes his or her company only has a viable future as a sustainable business, they fear stepping out of line with business orthodoxy.
The report says, quite rightly, that chief executives should band together to help overcome these barriers by lobbying for the economic and political conditions that are needed to support companies’ transition to a sustainable future.
Yesterday’s letter to the Financial Times by 27 heads of companies including BT, Thames Water, Nestlé, Asda, Tesco, Vodafone and Centrica supporting a recent call by British, French and German ministers for the EU to raise its 2020 carbon reduction target to 30% was a welcome example of the sort of business leadership that is needed.
In contrast, the Engineering Employers’ Federation recently called on the government to scrap the Carbon Reduction Commitment, the UK’s flagship carbon reduction policy.